Derivatives exchange, CME will launch Ethereum futures on 8th Feb at 6 PM ET. The exchange made the announcement in a tweet.
Building on the success of Bitcoin futures, Ethereum futures will also be cash-settled. To bring confidence to the trading strategy, the pricing will be based on a CME reference rate that draws ETH price data from major cryptocurrency exchanges Coinbase, Bitstamp, Gemini, itBit, and Kraken.
CME’s Ethereum futures were announced last year in December. The launch represents a significant step for Ethereum. The listing will help to introduce new participants – institutional investors to the second-largest cryptocurrency.
Don’t expect huge interest out of the gate
It could take some time to build awareness on the programmable side of the blockchain and what Ethereum represents for the future of open finance.
Much like Bitcoin futures launch in Dec 2017, don’t expect huge Ethereum futures volume on day 1. It took ~2 years for institutional investment to onboard on the future of money or digital gold. Similarly for Ethereum, it will take some time for investors to understand the programmable smart contracts side of the blockchain and the future of open finance.
However, given CME’s broad array of Bitcoin future participants, the asset should soon gain traction as an easy way to get access to the second-largest cryptocurrency and diversify crypto investment.